Stock price has lost 70 percent since December 2011, some call for acquisition.

While all eyes in the tech business world have largely been focused on Facebook lately, there’s another big player that has stumbled even more in recent months: Zynga. The San Francisco social media gaming company has lost about 70 percent of its value since its December 2011 initial public offering. As of this writing, the stock is trading just above $3 a share.

Worse still, some of its top executive and managerial talent are jumping ship, "as the online game maker grapples with slowing growth and a slumping share price that lessens the value of compensation," according to Bloomberg News.

Just yesterday, Alan Patmore, who oversaw CityVille, was lured away to Kixeye. Erik Bethke, a company general manager in charge of Mafia Wars 2, said on his Facebook page that he’d left the company this month. Bloomberg also reported that Ya-Bing Chu, a company vice president, and Jeremy Strauser also left this month. Chief Operating Officer John Schappert left the company on August 8 after disappointing earnings—he was only at the company for less than 18 months.

"It’s troubling when you start to see the plan not execute, and with departures, poor performance, the lowered outlook—these types of things are not great signs," said Brian Blau, an analyst with Gartner Research. "The more of those signs that we see, the worse off we’re going to be."

The company declined to respond to requests for comment beyond a canned statement.

"Zynga continues to lead the industry with the top talent in social game development," said Dani Dudeck, a Zynga spokesperson.

Is Zynga playing the long game?

Some have speculated that the company itself is ripe for acquisition. Business Insidersuggested this week that Amazon should go after the company. However, the company seems to be unwilling to sell—the company CEO, Mark Pincus, holds a majority stake in the company and said as recently as July that he would never consider a sale.

"I was upfront with everybody," he said at a PandoDaily event. "I said, ‘We’re never going to sell the company. There is no exit.’ I’ve said, ‘My only exit is by natural causes.’"

Still, some industry analysts said that there may not be reason for concern about the overall outlook on the company.

"The decline is because their older games aren’t monetizing as well as they did in the past, and they had believed they would be stable," wrote Michael Pachter, an analyst with Wedbush Securities, in an e-mail sent to Ars. "I don’t think that they are in trouble at all, they still make money, and don’t think they’re sellers below the $10 IPO."

Blau added that one of Zynga’s fundamental hurdles, like many other video game companies, is that they’re a "hit-driven business." And that may mean that while Zynga hasn’t had a smashing success lately, there could be ones in the pipeline to vault them ahead.

"The risk is that if they didn't have a hit then there could be trouble," he added.

"This happens to game companies. If you look at the history of the gaming industry, you can see a trailway of littered skeletons, and I’m not suggesting that’s the fate of Zynga, as they have a nice war chest, and a nice infrastructure. They may have trouble, but in the longer term, they may have games coming out that do well, they may be fine a year from now—they clearly know the plans and we don’t."

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Cyrus Farivar
Cyrus is a Senior Tech Policy Reporter at Ars Technica, and is also a radio producer and author. His latest book, Habeas Data, about the legal cases over the last 50 years that have had an outsized impact on surveillance and privacy law in America, is due out in May 2018 from Melville House. He is based in Oakland, California. Emailcyrus.farivar@arstechnica.com//Twitter@cfarivar

ok please who is surprised that this company is going under? I remember a couple years ago there were a couple of really fast-growing companies that did get stupid teenagers to spend a lot of money on ringtones, wallpapers and fartapps.They pretty much covered 95% of the advertisement space on all music TV channels. It was a million dollar business, had huge growth rates and everybody could see that there was no business case besides ripping off a not-so-knowledgeable segment of the population and it would die a horrible death in short time.

As was the case. Didn't stop some analysts from extrapolating growth rates and highlighting it as a huge buy opportunity.

And Zynga? On the same page. Farmville and co. are no games. They are a terrible scourge brought unto the earth by the dark gods of the underworld. And they didn't only make people suffer who were tricked into playing them but also the rest of the facebook population who had to endure cow invitations. Until they found the Hide this application button (Best facebook invention ever).

Popcap makes great simple games. (although not much of late). Zynga is just a temporary aberration that will be soon enough removed from the earth. And to speak of top talent in relation to Zynga is ridiculous as well.

Actually, the fact that they're slowly dying IS news. I mean Activision is still around, as is EA. THEY make horrible games* and show strong vitals.

*(at least, recently thanks to Mr. Kotick and his ilk. EA has been trying to turn a new leaf but seems to falling back into their old habits.)

EA and Activision still make games with more depth than click every 2 hours to win... It was only a matter of time until the people who didn't play games before realize there are more interesting things to do than click once every 2 hours.

Popcap makes great simple games. (although not much of late). Zynga is just a temporary aberration that will be soon enough removed from the earth. And to speak of top talent in relation to Zynga is ridiculous as well.

Popcap just got kneecapped by EA. Two studios shut down and staff slashed at the remaining one. More than 50% of the company has been fired.

My daughter loved playing FarmVille -- but she's 8, and cannot play it except on my wife's laptop & FB account (her PC is locked down with Norton Family). Even if you go to Zynga's site, where they now advertize you can play...

you have to log in with an FB account!

So, one way they could help - is let kids play directly on their site, show ads. Money.

I'm doing a self congratulatory victory dance on my end, as I called this over a year ago, ahh yeah, go me, go me! The overblown stock analysts that don't know anything about the industry they're speculating on are defeated once again, just like always!

Now that that's over, the Wii-U may be popular with a similar segment as previous, especially with "current" gen games coming to it and potentially an audience that only has a Wii at the moment. But the 360 and (potentially) PS3 will offer that at a lower price. Nintendo may be trying to ride its brand name with the Wii-U once again, just as it did with the 3DS. And while it's not likely to be overpriced as such there will still need to be a variety of Nintendo's evergreen titles for the Wii-U to truly take off. And considering how crappily repetitive these titles have become even the average consumer will question such in time, just as they've begun to question Call of Duty (finally).

In other words, the Wii-U is not a guarantee hit by any means. And its success may be highly hampered by competition from Sony and MS both this year and next, depending on what their price points and marketing are. Random gaming industry prediction guy AWAAAAAAYYYYY!!!

I'm doing a self congratulatory victory dance on my end, as I called this over a year ago, ahh yeah, go me, go me! The overblown stock analysts that don't know anything about the industry they're speculating on are defeated once again, just like always!

Now that that's over, the Wii-U may be popular with a similar segment as previous, especially with "current" gen games coming to it and potentially an audience that only has a Wii at the moment. But the 360 and (potentially) PS3 will offer that at a lower price. Nintendo may be trying to ride its brand name with the Wii-U once again, just as it did with the 3DS. And while it's not likely to be overpriced as such there will still need to be a variety of Nintendo's evergreen titles for the Wii-U to truly take off. And considering how crappily repetitive these titles have become even the average consumer will question such in time, just as they've begun to question Call of Duty (finally).

In other words, the Wii-U is not a guarantee hit by any means. And its success may be highly hampered by competition from Sony and MS both this year and next, depending on what their price points and marketing are. Random gaming industry prediction guy AWAAAAAAYYYYY!!!

Facebook will probably die as well.Won't be long till the next trendy social network site comes up and lots if not most people migrate to.Happened to myspace (remember that ghost town) and it happens in our physical world.Just think of the cool bar everyone liked to have a beer at or the trendy restaurant or that trendy music club and how people change their spots now and then.

I hate it when friends who are asking me to help them pickout a good laptop or desktop computer and I ask them "Do you plan on doing any gaming with this computer?" only to have them say "Oh, yes! I play Farmville all the time!". Don't let the door hit ya, Zynga!!!